IP: The Great Wi-Fi Hope

[David Farber <dave () farber net>]

reminder, I am an Advisor to Sky's company djf


> http://www.forbes.com/forbes/2002/0318/056.html
>
> Forbes
>
> The Great Wi-Fi Hope
> Quentin Hardy, 03.18.02
>
> Bold hackers with "junk" spectrum may revive high tech, reaping the next
> round of big bucks.
>
>
> Sky Dayton is always looking for what's next in tech. In 1994, when he was
> all of 22, he started reselling Internet access leased from a big backbone
> operator named Uunet. The company he founded, EarthLink, still thrives today
> as the number three Internet service provider. His 3.2% stake is worth $42
> million.
>
> Now Dayton is eyeing the next revolution, a wireless gold rush so bold and
> sweeping that it inspires rapture in even hardened Silicon Valley veterans.
> Best known for its engineering spec--802.11 ("eight-oh-two-dot-eleven")--and
> the nickname Wi-fi (for wireless fidelity), it offers lightning-fast data
> links around the home, in the office and across a neighborhood and beyond.
>
> The Wi-fi wave has already linked up an estimated 10 million laptops, Palm
> handhelds and other gadgets in hundreds of small, extremely local wireless
> networks. Some of these are commercial--one firm put them in several hundred
> Starbucks coffee shops. Many others are "freenets," access points provided
> gratis by 802.11 devotees who are, in essence, seeding the business. Mesh
> enough of these networks together and you have a mini-Net free of the phone
> and cable monopolies that control the "last mile" of wiring into your house.
> That's why 802 threatens them the most.
>
> This revolution promises to offer new things we didn't even know we wanted,
> from instant video on your laptop in an airport lounge (10% of the 30
> million laptops sold worldwide in 2001 are 802-ready) to a peek through
> every TV camera at a football game. Schools and hospitals can build their
> own networks, shipping sound and video across the room at up to 11 million
> bits per second, 196 times as fast as a PC modem.
>
> "This is the next frontier," says Dayton, who in late 2000 founded a new
> firm, Boingo, to offer 802 access. It is, in short, just what the depressed
> denizens of Silicon Valley need most. The Nasdaq has begun its third year of
> declines. Some $1 trillion in value has vanished in telecom alone, a number
> so big that few investors are unscathed. It has been hard to find
> hope--until now. The Wireless Ethernet Compatibility Alliance, an industry
> group with members like Intel and Cisco, says that worldwide sales of Wi-fi
> equipment will reach $5 billion by 2005. Sales were $1.5 billion last year.
>
> The Wi-fi wave arose in stealth in the past few years, with none of the
> usual proclamations by industry analysts or promises from big companies. It
> was nurtured by thousands of programmers working in the netherworld of
> "junk" spectrum, a narrow stitch of free bandwidth set aside by the Federal
> Communications Commission for things like microwave ovens and streetlamps.
>
> Cellular service typically uses a central swath of spectrum that is heavily
> regulated and highly priced; telecom titans had to pay billions for federal
> licenses and invest billions more to erect their networks. The 802 spectrum,
> by contrast, comes free of charge and is largely unregulated by the FCC, and
> the gear costs thousands of dollars, not millions.
>
> That's why Wi-fi is catching on like a prairie fire. Dozens of startups are
> working on the building blocks that will let this new wave proliferate.
> Venture capitalists see a spate of new investment prospects. Even telecom
> incumbents--the fat and unhappy titans vulnerable to an 802 uprising--are
> placing bets on the Wi-fi threat. Intel has committed several hundred
> million dollars to Wi-fi, Sony has plans to put it in every TV set and PC it
> sells in Japan and Microsoft plans a fall debut for Mira, a wireless
> computer pad with an 802 linkup to the Web. "This is huge," says Stephen
> Saltzman, a senior director at Intel. "It's one of the fundamental
> technologies, limited only by people's creativity." In 30 months Intel has
> slashed Wi-fi chip prices by 82% and boosted throughput by 5,400%--better
> gains than it scored in PC chips.
>
> At Boingo, Sky Dayton's new outfit, engineers are helping to roll out dozens
> of "hot spots," uplink points in neighborhoods, airports, hotels and coffee
> shops, tying together chaotic freenets and traditional office networks to
> form giant wireless systems. In Boingo's first two weeks of operation,
> Dayton brought on 500 low-power sites spread throughout the U.S. at sites
> like New York's Four Seasons Hotel. He plans to encompass 5,000 in his
> network by year-end. Boingo's $25-to-$75 monthly package includes a software
> "sniffer" that checks the air for nearby hot spots. If it finds one, the
> software identifies whether it is a freenet or an office network and decides
> whether the user is allowed access. If the access-point owner has affiliated
> with Boingo, the user is instantly connected, and the owner is paid a fee.
> Corporations can use encryption and firewalls to keep strangers out.
>
> Dayton started Boingo at the end of 2000, after he put an access point up in
> his house and got instant broadband, anywhere at home. "The moment it was
> on, I realized it would take in every house, every business," he recalls. At
> a tech conference in Aspen, Colo. early last year Dayton was about to dial
> in to EarthLink, but turned his sniffer on for a lark. To his amazement it
> offered four different networks he could access from his hotel room. Turning
> his back on his own ISP, Dayton went wireless. Then he started working on
> his new business.
>
> [...snip...]
>
> http://www.forbes.com/forbes/2002/0318/056.html

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